But try looking for the string “it’s happy that” in this sense and it turns out quite a few people use this expression.

Examples:

It's happy that early morning drives have become a treat In my life not a daily drudge [trudge?].

It’s happy that you have found us.

It's happy that you get to win

Here’s an instance which I at first thought was an example: “Transport for London (TfL) doesn't believe they're the same thing, and it has long said it's happy that Uber complies fully with regulations.” But in this case “it” refers back to “Transport for London.”

This expression is perfectly parallel in form and meaning with “it’s sad,” so why isn’t “it’s happy” as much standard usage as its opposite?

That’s the thing about idioms: they have their own patterns of evolution and often don’t follow normal rules. Most people say “it’s sad,” but they don’t say “it’s happy.”

This is the sort of thing that causes just a brief bump in the road of a conversation. A distinguished economist can say it without most people noticing that something’s a little off.